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MICK’S GARAGE,
)
PC3 No. 03-126
)
(UST Appeal)
)
)
NOTICE
REC~V~~
CLERK’S OFFICE
SEP 1 6 2003
STATE OF ILLINOIS
Pollution control Board
Dorothy M. Gunn, Clerk
Illinois Pollution Control Board
James R. Thompson Center
100 West Randolph Street
Suite 11-500
Chicago, IL 60601
Carol Sudman, Hearing Officer
Illinois Pollution Control Board
1021 North Grand Avenue, East
P.O. Box 19274
Springfield, IL 62794-9274
Curtis W. Martin
Shaw & Martin
123
South
Tenth Street
Suite 302
P.O. Box 1789
Mt. Vernon, IL 62864
PLEASE TAKE NOTICE that I have
today
filed
with
the office of the Clerk of the Pollution
Control Board a RESPONSE TO PETITIONER’S BRIEF, copies of which are herewith served upon you.
Respectfully submitted,
ILLINOIS ENVIRONMENTAL PROTECTION AGENCY,
Respondent
A~~i~tantCounsel
Special Assistant Attorney General
Division of Legal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
Dated: September 16, 2003
BEFORE
BOARD
Petitioner,
V.
)
)
ILLINOIS ENVIRONMENTAL
PROTECTION AGENCY,
Respondent.
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BEFORE THE POLLUTION CONTROL BOARD
OF THE STATE OF ILLINOIS
MICK’S
GARAGE,
)
Petitioner,
)
v.
)
PCB No. 03-126
ILLINOIS ENVIRONMENTAL
)
(UST Appeal)
PROTECTION AGENCY,
)
Respondent.
)
RESPONSE TO PETITIONER’S
BRIEF
NOW COMES the Respondent, the Illinois Environmental Protection Agency (“Illinois
EPA”), by one of its attorneys, John J. Kim, Assistant Counsel and Special Assistant Attorney
General, and, pursuant to an order entered by the Hearing Officer dated July 28, 2003, hereby
submits its Response to the Petitioner’s Brief to the Illinois Pollution Control Board (“Board”).
L BURDEN
OF PROOF
Pursuant to Section 105.112(a) of the Board’s procedural rules
(35
Ill. Adm. Code
105.112(a)), the burden of proof shall be on the petitioner. The burden of proving that
challenged costs in a claim for reimbursement are reasonable and related to corrective action
rests solely on the applicant for reimbursement. Richard and Wilma Salver v. Illinois EPA, PCB
98-156
(January 21, 1999), p. 3; ~
~
Ted Harrison Oil Company v. Illinois EPA, PCB 99-
127 (July 24, 2003), pp. 3-4 (the burden ofproof is on the owner or operator of an underground
storage tank to provide an accounting ofall costs). Similarly, in the present case, the burden of
proving that the decision under appeal (dated January 10, 2003) was erroneous is upon the
Petitioner; more specifically, the Petitioner has the burden of proving that the portion of that
decision related to the deductible applicable for the site is incorrect.
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II. STANDARD OF REVIEW
Section 22.18b(g) ofthe Environmental Protection Act (“Act”) provides that an applicant
may appeal an Illinois EPA decision denying reimbursement to the Board under the provisions of
Section 40 ofthe Act (415 ILCS
5/40).
Pursuant to Section 40 of the Act, the Board’s standard
of review is whether the application submitted to the Illinois EPA would not violate the Act and
Board regulations. Ted Harrison, p. 3. In this situation, the Board’s standard ofreview should
be whether the information submitted to the Illinois EPA would lead to a violation ofthe Act and
Board regulations ifthe deductible requested had been granted.
Based on the information within the Administrative Record (“Record”) and the testimony
elicited at hearing held on July 16, 2003,1 and applying the relevant law, the Illinois EPA
respectfully requests that the Board enter an order affirming the Illinois EPA’s decision.
IlL THE PETITIONER’S ARGUMENTS ARE BASED ON THE WRONG LAW
In its Brief, the Petitioner argues that pursuant to Section
57.9(b)
of
the Act (415 ILCS
5/57,9(b)),
it is entitled to a
decision that the deductible in this case should be assessed at either
$10,000.00 or $15,000.00. While this
argument
will be
addressed
in more detail
below, it must
be noted that the Petitioner’s
reliance
on language found in
Title XVI
ofthe Act (415 ILCS
5/57,
~ ~çq.)is misplaced. Here, the decision issued by the Illinois EPA was done pursuant to Section
22.18b ofthe Act.
As the Board described in Ted Harrison, the law in Illinois regulating releases from
underground storage tanks (“USTs”) transitioned from that found in Section 22.1 Sb ofthe Act to
Section
57
ofthe Act. Ted Harrison, pp.
4-5.
Without an express election to proceed pursuant to
the “new” law, a site that reported a release prior to the effective date of Section
57
would
Citations to the Administrative Record will hereinafter be made as, “AR, p.
.“
References to the transcript of
the hearing will be made as, “TR, p.
.“
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proceed pursuant to the law found in Section 22.1 8b. Here, there is no proof in the Record or
any documentation provided by the Petitioner that Mick’s Garage ever elected to proceed
pursuant to Section
57
ofthe Act. Further, although there is an incident number associated with
the
site
that was issued in 1999, the Petitioner itself admits that the report that led to the issuance
of that incident number was made only at the behest of art inspector from the Office ofthe State
Fire iMarshal (“OSFM”) following removal ofthe tanks in question. The Petitioner characterizes
that report as a second reporting of the initial suspected release of June 11, 1991. Petitioner’s
Brief, p. 2; AR, pp. 7, 14.
Therefore, since the Petitioner has acknowledged that the incident reported in 1999 was
simply a re-reporting of the initial release first reported in 1991, Section 22.1 8b of the Act
controls the decision under review. The Board in making its decision should not consider the
Petitioner’s arguments based on Section
57.9
of the Act. To do
otherwise would be an
application of a law that is clearly inapplicable.
The law that was applied by the Illinois EPA in reaching its decision dated February 7,
1992 (AR, pp. 1-2), was Section 22.18b(d)(3)(C)(ii) of the Act. That section provided in
pertinent part, “If the costs incurred were in. response to a release of petroleum which first
occurred prior to July 28, 1989, and the owner or operator had actual or constructive knowledge
that such a release occurred prior to July 28, 1989, the deductible amount
~“~‘
shall be $50,000
rather than $10,000
~
It shall be the burden of the owner or operator to prove to the
satisfaction of the Agency that the owner
or
operator had no actual or constructive knowledge
that the release of petroleum for which a claim is submitted first occurred prior to July 28, 1989.”
This appeal is allowed for by Section 22.1 8b(g) of the Act, and Section
22.18b(d)(3)(C)(ii) of the Act should be considered controlling to whatever limited extent the
3
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Illinois EPA’s decision of February 7, 1992 is scrutinized. Indeed, since no appeal of that
decision was ever taken by the Petitioner (TR, p. 24), that decision should be considered to be
valid and in effect
IV. THE
RELEVANT AND
UNDISPUTED FACTS SUPPORT
THE DECISION ISSUED BY THE ILLINOIS EPA
The Petitioner argues that certain undisputed facts, when applied to Section 57.9(b) ofthe
Act, require that the Board find that either the $10,000.00 or $15,000.00 deductible should be
applicable. Petitioner’s Brief, p. 4. This argument fails for a variety of reasons.
The undisputed facts presented by the Petitioner are that the two 2,000 gallon diesel fuel
USTs had not leaked, that any leak that occurred in 1991 related to gasoline USTs registered in
1986, that Mick’s Garage could not have had constructive knowledge prior to 1989 of a diesel
fuel tank that never occurred, and that there is no evidence in the Record that suggests Mick’ s
Garage had or could have had any knowledge of a leak from a gasoline US? prior to 1989.
.
Unfortunately, these are not the facts that the Board should find to be relevant or
undisputed. While a recitation of all the facts surrounding this case is not needed, there are a
number ofunusual circumstances that deserve mention.
The following statements are truly undisputed.
On June 11, 1991,
Mick’ s Garage
reported a suspected release from its site, leading to the issuance of incident number 911582.
AR, pp. 7, 9, 10, 14. At the time ofthe application for reimbursement that led to the issuance of
the Illinois EPA’s February 7, 1992 decision, Mick’s Garage assumed and represented that the
diesel fuel USTs at the site were taken out of service in 1980 due to a lead from the line going
from the connecting tank to pump. AR, p. 1; TR p. 23. On February 7, 1992, the Illinois EPA
issued a final decision setting the deductible for the site at $50,000.00, based on the information
presented in the underlying application and Section 22.18b(d)(3)(C)(ii). AR, pp. 1-2. Despite
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ai:iy later suspicions or changes in position, Mick’s Garage did not appeal the February 7, 1992
decision (nor the related March 9, 1992 final decision). TR, p. 24.
On April 8, 1999, six tanks were removed from the Mick’s Garage site under the
observation of an OSFM inspector. AR, p. 22. At the request ofthe OSFM inspector, a second
reporting of the occurrence first reported in 1991 was made, and a second Incident number
(990820) was issued. Petitioner’s Brief, p. 2; AR, p. 14.
On April 26, 2000, OSFM received an application for eligibility and deductibility from
Mick’s Garage, and on May 9, 2000, OSFM issued a decision stating that the applicable
deductible for the site was $15,000.00. Petitioner’s Exhibit 1, p. 1. In the application that led to
the May 9, 2000 OSFM decision, Mick’s Garage represented that there were 15 USTs at the site
and that the occurrence for which reimbursement would be sought was incident number 990820.
Petitioner’s Exhibit 1, p.
5.
Of the 15 tanks identified in that application, the tanks were either
associated with incident number 990820 or with an unidentified or inapplicable incident number.
Petitioner’s Exhibit 1, pp. 7-8. Also, of the 15 tanks, 10 were identified as having had a release;
for each ofthose 10 tanks, the date ofnotification of the release was listed as April
5,
1999.
~.
On May 17, 2000, the consultant retained by MIck’s Garage prepared and presumably
sent to OSFM another application for eligibility and deductibility. AR, pp. 5-10. In that
application, Mick’s Garage stated that the occurrence for whIch reimbursement would be sought
was incident 911582, and that incidentnumber 990820 was reported for the site but was a second
reporting of the same occurrence. AR, p. 7. Mick’ s Garage represented that there were 11 tanks
at the site. AR, p. 7. The application also represented that all 11 of the identified tanks were
associated with incident number 911582, all had experienced a release, and the releases for all
thosetankswasreportedonJune 11, 1991. AR, pp. 9-10.
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Later, on September 11, 2000, OSFM received another application for eligibility and
deductibility for the Mick’ s Garage site. Petitioner’s Exhibit 1, pp. 9, 12-16. That application
stated that the occurrence for which reimbursement would be sought was incident 911582, and
incident number 990820 was reported for the site as a second reporting of the same occurrence.
Petitioner’s Exhibit 1, p. 13. That application identified 11 tanks at the site, and stated that all
tanks had experienced a release that was reported on June 11, 1991. Petitioner’s Exhibit 1, p.
15.
On September 22, 2000, OSFM issued a decision in response to the application, setting the
deductible for the site. at $10,000.00. Petitioner’s Exhibit 1, pp. 9-10.
On August 8, 2002, Mick’s Garage sent a request that the deductible for the site be
considered. AR, pp. 14-22. On September 4, 2002, the Illinois EPA issued a final decision
stating that the proper deductible would be set at $50,000.00, per the original Illinois EPA
decision. AR, pp. 23-25. The decision also referenced that the information sent by Mick’s
Garage was discussed with a representative of OSFM. AR, p. 23. No appeal of that decision
was ever taken.
On November 12, 2002, Mick’s Garage sent a Site Characterization Report/Corrective
Action Plan to the Illinois EPA for review. AR, pp. 27-35. In that submittal, Mick’s Garage
again raised the issue of the correct deductible for the site, and references the $10,000.00 and
$15,000.00 deductibles assessed by OSFM (though without a clear statement as to whIch of
those two deductibles should be applied). AR, pp. 27-28. The Illinois EPA’s decision dated
January 10, 2003, was issued in response to that submittal. AR, pp. 35-38.
As seen by these facts, this site has had several different deductibles determined as
applicable. The Illinois EPA first set the deductible at $50,00000 (at a time when the Illinois
EPA was empowered to issue such decisions). Later. Mick’s Garage submitted at least two
6
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different applications to OSFM seeking new deductible decisions, leading to assessments of
$15,000.00 and later $10,000.00 for the site. The information contained within the applications
to the Illinois EPA and the OSFM varied, in terms of.number of tanks at the site to whether and
when the tanks experienced releases. The first application leading to a deductible was submitted
to the Illinois EPA in November 1991, and applications were later submitted to OSFM in April
and September of 2000.
Given the inconsistent information presented, and the question of whether OSFM even
has the authority to issue
any decision on the deductible following that issued originally by the
Illinois EPA, the facts warrant a decision by the Board that the
Illinois EPA’s
final decision was
proper.
V. THE ILLINOIS EPA IS NOT AUTHORIZED TO CHANGE ITS FINAL DECISIONS
It is well-established that the Illinois EPA is not authorized to change or reconsider its
final decisions. Rcichhold Chemicals. Inc. v. Illinois Pollution Control
Bd,
204 111. App. 3d
674,
561
N.E.2d 1343 (3d Dist. 1990). Here, that means the Illinois EPA is bound to its decision
on a deductible as was issued on February 7, 1992. Given that the PetItioner did not file an
appeal ofthat decision, the Petitioner likewise should be considered subject to and bound by the
decision. The Illinois EPA’s 1992 deductibility decision, never having been appealed, should be
considered valid on its face. The best argument that the Petitioner can raise is not whether the
decision is correct, but rather whether the Illinois EPA and the Board should look the other way
and instead follow
one of
the subsequent OSFM decisions.
In its letters dated August 8, 2002, and November 12, 2002, Mick’s Garage raised the
issue of whether the $50,000.00 deductible should be applied to its site. Specifically, the request
was made that the Illinois EPA ignore its decision ofFebruary 7, 1992, and instead abide by one
7
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of the two different decisions issued by OSFM. At that time in 2002, even ifthe Illinois EPA did
choose to change its February
7,
1992 decision, it was unable to do so (the edict of Reichhold
ç~~icalsnotwithstanding) since the authority to issue such decisions had passed (by virtue of
the terms of Title XVI ofthe Act) to OSFM.
VI. OSFM’s DECISIONS SHOULD NOT BE CONSIDERED AS VALID
The Petitioner seems to be arguing that, in this case, it was simply asking the illinois EPA
to take note of the passing of authority to issue determinations on deductibility, and to abide by
the decision(s) ofOSFM regarding deductibility. However, the Illinois EPA could not do so for
several reasons.
First, there is a very real question of whether OSFM had any authority to issue a
deductible decision in this case. As the Petitioner noted several times, including in its
applications to OSFM, the incident reported in 1999 was simply a re-reporting of the original
incident which was reported in 1991. The most recent application submitted by Mick’s Garage
to OSFM indicated that any reimbursement for the tanks in question would be sought pursuant to
the 1991 incident number, and
that the 1999 incident
number related to the same occurrence.
If that
is true, and
the Illinois EPA
believes it is, then OSFM would have had no authority
to issue any decision on deductibility for the Mick’s Garage site. There is no evidence that
demonstrates that Mick’s Garage ever elected to proceed pursuant to Section
57
of the Act;
therefore, remediation and pursuit ofreimbursement for the site must be done in accordance with
Section 22.1 8b ofthe Act. Pursuant to that legal framework, OSFM did not have any authority
to issue decisions on the question of what is the correct deductible. Since OSFM did not have
any deductibility authority pursuant to Section 22.1 8b, and since the site remains subject to
regulation pursuant to Section 22.1 Sb in the absence of an election to proceed otherwise, the
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OSFM
decisions should be considered to have no validity The Illinois EPA cannot deviate from
its original decision, one that was never appealed, and instead process claims for reimbursement
based on decisions made by an agency that has no authority to issue those decisions. In a
broader sense, this issue is the same as was raised earlier; namely, whether any provision of
Section
57
of the Act should be found to be applicable for the Mick’s Garage site, since no
election to proceed pursuant to that Section was ever made by Mick’s Garage. Since no such
election was made, no provisions of Section
57
(including that which confers the authority upon
OSFM to issue deductibility decisions) should be found to be applicable.
Second, even if the Illinois EPA (or the Board,
for
that matter) were to decide that the
OSEM decisions should be given some weight, the question becomes which ofthe two decisions
should be followed? Even the Petitioner is hedging on that issue, as it notes in its brief that the
$10,000.00 deductible applies, or ~at the very least, the $15,000.00 deductible applies.”
Petitioner’s Brief, p. 4. If the Board finds that the Illinois EPA’s decision dated January 10,
2003 was in error, then it must also find that the Illinois EPA should have instead followed one
ofthe two decisions issued by OSFM. The Illinois EPA would then be required to have to pick
and choose between differing decisions based on differing information within
the respective
applications.
Ifthe simple answer of following the most recent application in time were to be given,
then
the Board would be opening the door for an owner
or operator to simply apply
over and
over again to OSFM for deductibility determinations with the hopes that the lowest possible
deductible would eventually be granted. Though the information differed between the two
applications submitted to OSFM, the applications were submitted only months apart, and each
almost 10 years following the incident that is supposedly at issue and identified by the Petitioner
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as being related to the only occurrence (i.e., 911582) and three years after the removal of the
tanks themselves There is a very real question as to why after such a long period oftime there
was such an abrupt change in information from one application to the other, arid a very real
possibility that a potential for abuse of the system would be allowed if the second OSFM
decision were to be deemed the “correct” decision. If the Board allows that either the first or
second OSFM decision should be followed, it is creating a situation in which OSFM can issue
decisions when it is otherwise not empowered to do so, with the added invitation for an applicant
to submit multiple applications for the same site in hopes ofcontinually lowering the deductible.
VII. CONCLUSION
For all the reasons and arguments included herein, the Illinois EPA respectftlly requests
that the Board affirm its January
10, 2003 decision. The Illinois EPA
had no choice but to
adhere to its decision dated February
7,
1992, and the Petitioner was likewise bound by that
decision. Since no election to proceed with remediation ofthe site pursuant to Section
57
ofthe
Act was ever made, no provision ofthat Title ofthe Act is applicable. Accordingly, OSFM did
not have any authority to issue either of its two deductible decisions. Even if OSFM does
somehow have the authority to issue deductible determinations for a site that has experienced a
pre-1993 release, it is unclear which of its two decisions should be followed, The Illinois EPA
does not have the authority
to
weigh competing decisions issued by OSFM and decide which of
the different decisions was correct, and therefore reliance upon the only decision that was clearly
issued pursuant to a recognized statutory authority was the correct decision. For these reasons,
the Illinois EPA respectfully requests that the Board affirm the Illinois EPA’s January 10, 2003
decision.
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RespectfullY submitted,
ILLLNOIS ENVIRONMENTAL PROTECTION AGENCY,
Assistant Counsel
Special Assistant Attorney General
Division of Legal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544,
2171782-9143
(TDD)
Dated: September 16, 2003
This
filir~gsubmitted ~
recycled paper~
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CERTIFICATE OF SERVICE
I, the undersigned attorney at law, hereby certify that on September 16, 2003, I served
true and correct copies ofa RESPONE TO PETITIONER’S BRIEF, by placing true and correct
copies in properly sealed and addressed envelopes and by depositing said sealed envelopes in a
U.S. mail drop box located within Springfield, Illinois, with sufficient First Class Mail postage
affixed thereto, upon the following named persons:
Dorothy M Gunn, Clerk
Curtis
W.
Martin
Illinois Pollution Control
Board
Shaw & Martin
James R.
Thompson Center
123 South Tenth
Street
100 West Randolph Street
Suite 302
Suite 11-500
P.O. Box 1789
Chicago, IL 60601
Mt. Vernon, IL 62864
ILLINOIS ENVIRONMENTAL PROTECTIONAGENCY.
Assistant Counsel
Special Assistant Attorney General
Division of Legal Counsel
1021 North Grand Avenue, East
P.O. Box 19276
Springfield, Illinois 62794-9276
217/782-5544
217/782-9143 (TDD)
TOTRL P.14
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ILLINOIS ENVIRONM~ENTALPROT ECTION AGENCY
DIVISION OF LEGAL COUNSEL
1021 NORTH GRAND AVENUE EAST, POST OFFICE BOX 19276
SPRINGFIELD, ILLINOIS 62794-9276
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